Russian President Vladimir Putin attends a signing ceremony of bills making Crimea part of Russia in the Kremlin in Moscow, Friday, March 21, 2014. / Sergei Chirikov AP

by USA TODAY

by USA TODAY

Russian stock market and its currency rallied Wednesday in relief that U.S. and European sanctions didn't hit its vital gas industry.

The Russian MICEX index was up 1.08% this morning, after having risen 2.2% in early morning trading. The ruble rose 0.5% against the dollar.

While the U.S. and Europe introduced tough new sanctions on Russia's financial services industry and its energy services industry, the natural gas sector was largely unscathed. In addition, some Russian technology companies, such as Yandex, the Google of Russia, reported good second-quarter earnings on Wednesday.

The sanctions bar Russian state-owned banks from selling shares or bonds in Europe and restrict the export of oil equipment. The U.S. and Europe also barred exports of military equipment to Russia. The U.S. also imposed fines on three large Russian banks.

Nevertheless, traders were relieved that Europe and the U.S. levied no sanctions against OAO Sberbank, Russia's biggest lender, according to Bloomberg. And state oil giant Rosneft rose 0.6% and Lukoil gained 0.5% in early trading.

In the meantime, Russia has threatened some sanctions of its own, including banning imports of chicken from the U.S. and fruit from the European Union. More ominously, rumors have circulated about the Russians seizing assets from British Petroleum and Shell, says Simon Mandel, vice president of emerging equities at Auerbach Grayson in New York.

Despite today's rally, the longer-term outlook for Russian stocks is dim, given the problems in The Ukraine, Mandel says. "They're not out of the woods now," he says. "This entire debacle is putting the longer-term structural story for Russian growth into question."